Personal income growth in New York nearly flatlined in the first quarter of this year, reflecting the start of the economic shutdown triggered by the coronavirus crisis, according to data released today by the federal Bureau of Economic Analysis (BEA).
Revised BEA data also show New Yorkers’ incomes weren’t exactly roaring upward in the final quarter of 2019, either—a sign that the state economy was weakening even before the pandemic.
This is an installment in a special series of #NYCoronavirus chronicles by Empire Center analysts, focused on New York’s state and local policy response to the coronavirus pandemic.
Incomes on PAUSE
New Yorkers’ seasonally adjusted personal incomes grew by just 0.7 percent during the three months ending March 31, compared to the final quarter of 2019. This was less than one third the U.S. average of 2.3 percent and the third lowest among all states during the same period. Only Hawaii (-0.1 percent) and Michigan (-0.3 percent) had weaker personal income growth than New York in the first quarter.
The number would have looked even worse if Empire State resident incomes hadn’t been propped up by transfer receipts, mainly from Social Security and other government benefits, which increased 8.6 percent, and dividends, interest and rents, which rose 1.6 percent.
New Yorkers’ net earnings—a category including wages, salaries and business proprietors’ incomes—were down 1.6 percent for the quarter. This was consistent with a national pattern in which “earnings increased at the slowest pace since the first quarter of 2013 due to the partial economic shutdown following the outbreak of the COVID-19 pandemic in the first quarter of 2020,” the BEA said.
The nationwide map from BEA, in which pale shading equates to weak growth:
Falling behind
New York’s relative weakness in the first quarter of this year was not surprising given the extreme measures taken by Governor Cuomo to prevent the spread of COVID-19, starting with a shutdown of all normal business and social activity the third week in March. New York’s private job losses since the shutdown also have been especially severe by national standards.
The newly revised BEA data also indicate the state’s economic growth rate was slowing in the run-up to the pandemic. Today’s numbers show New York’s personal income during the fourth quarter of 2019 was just 1.3 percent—among the lowest increases in any state during a period when U.S. average income growth was 3.6 percent.
About the Author
You may also like
New Yorkers’ Health Costs Spiral as Officials Take Credit for ‘Savings’
The latest round of health insurance premium hikes announced by New York regulators adds to evidence that state policies are drowning consumers instead of helping them.
Late last mo Read More
The Math Does Not Support New York’s Climate Plan
I am not anti-renewable and I am not a climate denier. What I am is an engineer that lives by numbers. The numbers underpinning the CLCPA—namely the belief that New York can replace most of its natural gas-fired electricity generation with renewables in the next six or even nine years—are a fantasy. Read More
What Paul Francis Got Wrong About the Empire Center’s Nursing Home Research
In February 2021, the Empire Center published the first independent analysis of the Cuomo's administration much-debated directive ordering Covid-positive patients into nursing homes. The report found that the directive was associated with a statistically significant increase in resident deaths in the homes that admitted the infected patients. Read More
State Energy Planning Board Flouts the Law
The New York State Energy Planning Board reconvened yesterday to kick off a new round of energy planning. And it violated the state's Open Meetings Law before the gavel fell. Read More
Internal Cuomo Administration Documents Showed Evidence of Harm from Nursing Home Order
State Health Department documents from June 2020, newly unearthed by congressional investigators, appear to show harmful effects from a controversial order requiring nursing homes to admit Covid-positive patients.
Read More
NY Taxpayers Face Bitter Truth from Sweeter Pensions
Governor Hochul and state lawmakers this year approved a costly giveaway for public employee unions that retroactively hiked pension benefits. Now the bill is arriving. Read More
On Covid in Nursing Homes, There’s No Comparison Between Cuomo and Walz
Former Governor Andrew Cuomo and his political critics have something in common: They're both trying to drag Minnesota Governor Tim Walz into Cuomo's nursing home scandal.
Cuomo’s attempt to hide behind Walz, li Read More
Learning Nothing, NY Heads Back to School
The start of a new school year finds New York’s public education system in a well-funded state of confusion and contradiction: flush with cash amid falling test scores and declining enrollment, spending more than ever as state-level bureaucrats plan to weaken graduation standards—but still can’t tell parents how their students performed in last spring’s assessments. Read More